A new revolution in health insurance? IRDAI directs insurers to launch plans for HIV and mental illness

IRDAI’s directive for plans covering mental illness and HIV

Insurers launch plans for HIV and Mental Illness

The Insurance Regulatory and Development Authority of India (IRDAI) not only regulates the Indian insurance market but also proposes relevant changes depending on the need of the market. Recently, the regulator has pushed insurers to innovate and simplify their products to increase insurance penetration in India.

Related - Read more about IRDAI initiatives to put the customer first in insurance

IRDAI places great emphasis on customer-centricity and has, thus, directed insurers to make the required changes to benefit customers. In a recent move, the regulator has insurance companies issue health insurance policies designed specifically for individuals suffering from HIV, mental illnesses or disabilities. Let’s understand what IRDAI has directed.

IRDAI directives for insurers

Earlier, IRDAI asked health insurance companies to allow coverage for mental illnesses which were otherwise excluded from the scope of coverage. Following the earlier directive, many insurers included coverage for mental treatments in their health insurance plans. However, not all insurers followed suit.

Cracking up on the non-compliant insurers, IRDAI has now issued a new directive. Here’s what the directive says –

  • It is mandatory for non-life insurance companies that offer health insurance products to issue health plans tailored for people suffering from disabilities, HIV and mental illnesses.
  • The details and parameters of a model policy have also been recommended by the regulator. The model policy lays down the minimum scope of coverage. Insurance companies can offer wider coverage but cannot restrict the coverage laid down under the model policy.
  • The coverage should be issued immediately.
  • The coverage can be offered for a year, after which it should be renewable.
  • No proposal for coverage should be denied by insurers if the proposer suffers from disabilities, mental illnesses or HIV.
  • Insurance companies can price the product according to their pricing policy. However, they should follow the guidelines specified in the IRDAI (Health Insurance) Regulations, 2016.

What does it mean for consumers?

The directive for non-discrimination against people suffering from mental illnesses, HIV or disabilities was issued by IRDAI years back. Since insurers did not incorporate the changes then, the regulator is immediately tightening the norms.

As insurers comply with the mandatory guidelines of IRDAI, the health insurance market will get more liberalised. People who are incurring considerable expenses on treatments for disabilities, mental illnesses or HIV would get financial relief as they avail of the coverage. Thus, for consumers, the launch of specified plans is good news.

Look out for health insurance companies' plans following the IRDAI directive. If you or anyone you know suffers from the specified illnesses, such plans will go a long way in providing financial security.

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